In the startup world, “scaling your business” has become a bit of a buzz phrase. Being able to scale is an integral part of continued growth and profit for your eCommerce business, and it’s really a simple concept: As the demands on your business increase — i.e. more customers start ordering your product — your business has to have operations and processes in place to handle that increased demand.
It’s not uncommon for a sudden surge in growth to cause major issues for a small business.
A brief mention on a popular website and you might wake up to an enormous number of orders that you can’t possibly fulfill alone.
It often happens to bloggers: A blog post is retweeted or posted to Facebook or Pinterest, the link goes viral and suddenly the blogger’s server is overloaded and crashes. Sure, this might sound like a dream come true, but if you haven’t put the infrastructure in place to scale your eCommerce business sustainably, it can result in some very dissatisfied customers (or readers). Your business will become overwhelmed by new demands and provide inferior customer service unless your operations are scaled to meet demand.
4 steps to scale your eCommerce business
Luckily, the eCommerce industry lends itself to scalability. Here are some simple-but-effective ways to prepare your eCommerce business for rapid growth.
Stop filling your orders independently.
Leverage existing customers.
Let’s learn more about these four steps to scale.
1. Stop filling your orders independently
One of the quickest and easiest ways to prepare your eCommerce business to scale is to stop filling your own orders. Packing, shipping, trips to and from the post office — all of this creates a huge and time-consuming task. It’s an unnecessary activity for a business owner that should be eliminated at the first opportunity.
It’s relatively easy to outsource and often cost-effective, even for smaller eCommerce operations.
Dropshipping is a very effective order fulfillment strategy for most eCommerce businesses. With dropshipping, your business teams up with a supplier who provides the product and ships it directly to your customers. This not only eliminates the chore of packaging and shipping orders but also saves you from the burden of keeping inventory in your own space. But dropshipping also has its cons. It leaves you at the mercy of the supplier and prevents you from taking advantage of bulk purchase discounts for your products.
Outside of dropshipping, there are other order fulfillment providers that will house your inventory and ship it for you when an order is made (Amazon has its very own called Fulfillment by Amazon). Companies like Boxzooka, ShipBob and Ships-a-Lot can provide you with a quote that usually includes fees for receiving inventory, storage and picking and packing orders.
So how do you decide if the fees charged by an order fulfillment provider make sense for your business?
Simple: Put a price tag on your own services for shipment receiving, storage and order picking and packing.
When you include an hourly rate for yourself and really monetize your time, consider how valuable that time will be if the current volume of your orders doubles or triples. It’s likely that the fees quoted by outside providers are going to make more sense for your business.
2. Leverage existing customers
The responsibility for marketing your company can’t land squarely on your shoulders as the business owner — at least not forever. While you might have spent the early days of your business slaving away at social media and blog posts and marketing campaigns, that’s not going to make sense as your business gets bigger.
Creating efficient marketing pipelines out of your existing customers is one highly productive way to scale your eCommerce business.
There are a number of ways to leverage your existing customers for marketing:
- Social media brand advocates
… just to name a few.
While it’s likely your customers are already getting an email requesting a review immediately after their purchase, increase the incentive with a follow-up email a week later and include a discount coupon. Not only will they have had an opportunity to use (and love!) your product or service by this point, but they will also be encouraged by the savings on a future purchase.
Referrals are also a very powerful form of viral marketing, as evidenced by online companies like Airbnb and Uber. Not only can you offer an incentive for new customers and the friends who referred them through your program, but you can also take your referral program a step further with brand advocates.
When you find a particularly enthusiastic review or referral, make the effort to acknowledge and appreciate that customer.
Tag them in a personalized shoutout on your company’s social media accounts or send them a direct message.
Brand advocates can also provide valuable information about buyer habits and the user experience with your product. It’s a good idea to solicit their input and advice.
Once you have a pool of brand advocates, provide them with advance access to deals and new products. Remember that much of this can be automated. Not only will you save time, but you will find that brand advocates and word-of-mouth marketing are probably more effective than your current home-spun marketing efforts.
One of the most delightful parts of running an eCommerce business is that there are plenty of opportunities for you to automate services. You can automate chat features on your website, email marketing features and even pricing (with tools like Amazon’s RepricerExpress).
Automation is an excellent growth strategy as it’s almost like creating copies of yourself to provide a more streamlined, professional experience for your customers.
It also increases the speed of various transactions, which always makes customers happy.
When thinking of where to start with automation, repetition is a dead giveaway that a task can be automated. If you’re sending the same email multiple times a day or week, automate it. If you’re clicking the same series of buttons on your website, automate it. The bookkeeping and accounting you’re doing every month? Automate it with a synchronizable bookkeeping service.
Most, if not all, of your email communication with customers should be automated.
Much of your social media posting can also be automated, or at the very least prescheduled with a tool like Hootsuite or Buffer. You can also automate sales and seasonal promotions and the analytics and data collection for your company. In an ideal world, your store’s product availability will be updated automatically in response to purchases, returns and the arrival of new products.
That said, don’t go overboard with automation.
There are times when an automated response simply won’t do the trick — for example, when you are personally thanking a brand advocate, or when a customer is displeased. Negative reviews and customer displeasure require a personal touch and shouldn’t ever be dealt with through automation.
In the same way you outsource your order fulfillment, you should start searching for other processes that can be outsourced, too. Outsourcing is an excellent, effective strategy to scale your eCommerce business.
As a business owner, you’ll come to realize that you’re wearing a lot of hats, and some of the tasks you’re completing might not be the ones you’re best suited for.
Find small ways that you can take tasks off your plate and make your business more self-sufficient. As your business grows, your time will become more valuable, so create more of that time now by hiring other people to complete the tasks they have more experience with.
If writing isn’t your forte, it’s probably worth the money to pay a professional to write converting, engaging blog posts for your site.
Blogging is an excellent example of a task that many eCommerce entrepreneurs outsource with great success.
You might also consider outsourcing your social media management or media relations if your business has come to that stage.
When considering what to outsource, remember that you will have to front-load some of your time into hiring and training. Document this process well to simplify future outsourcing.
Outsourcing is not a process to enter lightly or haphazardly, but the payoff can be considerable when you find the right freelancer or contractor to complete a tedious task on your behalf.
Prepare your eCommerce business to scale
It’s important to set some basic infrastructure into place now so that, when the time comes, your business can seamlessly respond to a spike in demand. But it’s not enough to simply prepare for growth — effective scaling is when your business can accommodate a major increase in operations without a major increase in operating costs.
This means each step you take to scale your eCommerce business and prepare it for rapid growth should be a mindful, cost-effective move for your company on the whole.
While scaling your eCommerce business will take some time upfront, the ultimate result will be a more efficient, functional business that can handle a high level of demand.